<PAGE>
SCHEDULE 14A INFORMATION
PROXY STATEMENT PURSUANT TO SECTION 14(A) OF THE SECURITIES
EXCHANGE ACT OF 1934 (Amendment No. )
Filed by the Registrant [X]
Filed by a Party other than the Registrant [_]
Check the appropriate box:
[_] Preliminary Proxy Statement [_] CONFIDENTIAL, FOR USE OF THE
COMMISSION ONLY (AS PERMITTED
BY RULE 14a-6(e)(2))
[X] Definitive Proxy Statement
[_] Definitive Additional Materials
[_] Soliciting Material Pursuant to (S)240.14a-11(c) or (S)240.14a-12
NEW HAMPSHIRE THRIFT BANCSHARES, INC.
- --------------------------------------------------------------------------------
(Name of Registrant as Specified in Its Charter)
NEW HAMPSHIRE THRIFT BANCSHARES, INC.
- --------------------------------------------------------------------------------
(Name of Person(s) Filing Proxy Statement, if other than the Registrant)
Payment of Filing Fee (Check the appropriate box):
[X] No fee required.
[_] Fee computed on table below per Exchange Act Rules 14a-6(i)(4) and 0-11.
(1) Title of each class of securities to which transaction applies:
------------------------------------------------------------------------
(2) Aggregate number of securities to which transaction applies:
------------------------------------------------------------------------
(3) Per unit price or other underlying value of transaction computed
pursuant to Exchange Act Rule 0-11 (Set forth the amount on which the
filing fee is calculated and state how it was determined):
------------------------------------------------------------------------
(4) Proposed maximum aggregate value of transaction:
------------------------------------------------------------------------
(5) Total fee paid:
------------------------------------------------------------------------
[_] Fee paid previously with preliminary materials.
[_] Check box if any part of the fee is offset as provided by Exchange Act
Rule 0-11(a)(2) and identify the filing for which the offsetting fee was
paid previously. Identify the previous filing by registration statement
number, or the Form or Schedule and the date of its filing.
(1) Amount Previously Paid:
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(2) Form, Schedule or Registration Statement No.:
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(3) Filing Party:
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(4) Date Filed:
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Notes:
<PAGE>
March 5, 1999
Dear Shareholder:
You are cordially invited to attend the Annual Meeting of Shareholders of
New Hampshire Thrift Bancshares, Inc. (the "Company" or "NHTB"), the holding
company for Lake Sunapee Bank, fsb (the "Bank" or "LSB"), to be held on April 8,
1999, at the Lake Sunapee Bank Building, 1868 Room, 9 Main Street, Newport, New
Hampshire, at 10:00 a.m.
The items of business which will be considered and voted upon this year are
explained in the accompanying Proxy Statement. Even if you are planning to
attend, please complete and return the enclosed Proxy Card. This will guarantee
that your preference will be expressed, and you will still be able to vote your
shares in person if you attend.
If you have any questions about the Proxy Statement or the 1998 Annual
Report, please let us hear from you.
Sincerely,
/s/ John J. Kiernan
John J. Kiernan
Chairman of the Board
<PAGE>
NEW HAMPSHIRE THRIFT BANCSHARES, INC.
9 MAIN STREET
P.O. BOX 9
NEWPORT, NH 03773
(603) 863-0886
Notice of Annual Meeting of Stockholders
Date: Thursday, April 8, 1999
Time: 10:00 a.m., local time
Place: Lake Sunapee Bank Building
1868 Room
9 Main Street
Newport, NH 03773
At our 1999 Annual Meeting, we will ask you to:
. Elect four directors to serve for a three-year term expiring at the
2002 annual meeting. The following four directors are the Board of
Directors' nominees:
Leonard R. Cashman Stephen W. Ensign Dennis A. Morrow
Kenneth D. Weed
. Ratify the appointment of Shatswell MacLeod & Co., P.C. as our
independent certified public accountants for the fiscal year ending
December 31, 1999; and
. Transact any other business as may properly come before the Annual
Meeting.
You may vote at the Annual Meeting if you were a stockholder of the Company
at the close of business on February 12, 1999, the record date.
By Order of the Board of Directors,
/s/ Linda L. Oldham
Linda L. Oldham
Secretary
Newport, New Hampshire
March 5, 1999
THE BOARD OF DIRECTORS URGES YOU TO SIGN, DATE AND RETURN YOUR PROXY CARD
AS SOON AS POSSIBLE, EVEN IF YOU CURRENTLY PLAN TO ATTEND THE ANNUAL MEETING.
THIS WILL NOT PREVENT YOU FROM VOTING IN PERSON AT THE MEETING IF YOU DESIRE,
AND YOU MAY REVOKE YOUR PROXY BY WRITTEN INSTRUMENT AT ANY TIME PRIOR TO THE
VOTE AT THE ANNUAL MEETING. PLEASE INDICATE ON THE PROXY CARD IF YOU WILL BE
ATTENDING THE MEETING.
<PAGE>
NEW HAMPSHIRE THRIFT BANCSHARES, INC.
9 MAIN STREET
P.O. BOX 9
NEWPORT, NEW HAMPSHIRE 03773
(603) 863-0886
-----------------------------
PROXY STATEMENT
-----------------------------
General
We have sent you this Proxy Statement and enclosed proxy card because the
Board of Directors is soliciting your proxy to vote at the Annual Meeting. This
Proxy Statement summarizes the information you will need to know to cast an
informed vote at the Annual Meeting. You do not need to attend the Annual
Meeting to vote your shares. You may simply complete, sign and return the
enclosed proxy card and your votes will be cast for you at the Annual Meeting.
This process is described below in the section entitled "Voting Rights."
We began mailing this Proxy Statement, the Notice of Annual Meeting and the
enclosed proxy card on or about March 5, 1999 to all stockholders entitled to
vote. If you owned the Company's common stock ("Common Stock") at the close of
business on February 12, 1999, the record date, you are entitled to vote at the
Annual Meeting. On the record date, there were 2,104,285 shares of Common Stock
outstanding.
Quorum
A quorum of stockholders is necessary to hold a valid meeting. If the
holders of at least one-third of the total number of the outstanding shares of
Common Stock of the Company entitled to vote are represented in person or by
proxy at the Annual Meeting, a quorum will exist. We will include proxies
marked as abstentions and broker non-votes to determine the number of shares
present at the Annual Meeting.
Voting Rights
You are entitled to one vote at the Annual Meeting for each share of the
Company's Common Stock that you owned as of record at the close of business on
February 12, 1999. The number of shares you own (and may vote) is listed at the
top of the back of the proxy card.
You may vote your shares at the Annual Meeting in person or by proxy. To
vote in person, you must attend the Annual Meeting and obtain and submit a
ballot, which we will provide to you at the Annual Meeting. To vote by proxy,
you must complete, sign and return the enclosed proxy card. If you properly
complete your proxy card and send it to us in time to vote, your "proxy" (one of
the individuals named on your proxy card) will vote your shares as you have
directed. If you sign the proxy card but do not make specific choices, your
proxy will vote your shares FOR each of the proposals identified in the Notice
---
of the Annual Meeting.
<PAGE>
If any other matter is presented, your proxy will vote the shares
represented by all properly executed proxies on such matters as a majority of
the Board of Directors determines. As of the date of this Proxy Statement, we
know of no other matters that may be presented at the Annual Meeting, other than
those listed in the Notice of the Annual Meeting.
Vote Required
Proposal 1: The four nominees for director who receive the most
Elect Four Directors votes will be elected. So, if you do not vote for a
nominee, or you indicate "withhold authority" for any
nominee on your proxy card, your vote will not count
"for" or "against" the nominee. You may not vote your
shares cumulatively for the election of directors.
Proposal 2: The affirmative vote of a majority of the shares present
Ratify Appointment in person or by proxy at the Annual Meeting and entitled
of Independent to vote on this proposal is required to ratify the
Public Accountants appointment of Shatswell, MacLeod & Co., P.C. as the
Company's independent certified public accountants. So,
if you "abstain" from voting, it has the same effect as
if you voted "against" this proposal.
Effect of Broker Non-Votes
If your broker holds shares that you own in "street name," the broker may
vote your shares on the two proposals listed above even if the broker does not
receive instructions from you. If your broker does not vote on any of the
---
proposals, this will constitute a "broker non-vote." Here is the effect of a
"broker non-vote":
. Proposal 1: Elect Four Directors. A broker non-vote would have no effect
on the outcome this proposal because only a plurality of votes cast is
required to elect a director.
. Proposal 2: Ratify Appointment of Independent Public Accountants. A
broker non-vote would have no effect on the outcome of this proposal.
Revoking Your Proxy
You may revoke your proxy at any time before it is exercised by:
. Filing with the Secretary of the Company a letter revoking the proxy;
. Submitting another signed proxy with a later date; and
. Attending the Annual Meeting and voting in person, provided you file a
written revocation with the Secretary of the Annual Meeting prior to the
voting of such proxy.
If your shares are not registered in your own name, you will need
appropriate documentation from your stockholder of record to vote personally at
the Annual Meeting. Examples of such documentation include a broker's
statement, letter or other document that will confirm your ownership of shares
of the Company.
-2-
<PAGE>
Solicitation of Proxies
The Company will pay the costs of soliciting proxies from its stockholders.
The Company has engaged Morrow & Co., Inc. to assist in the solicitation of
proxies for the meeting. The Company will pay Morrow & Co., Inc. for its
services:
. $2,500 in fees; and
. out-of-pocket expenses.
Directors, officers or employees of the Company and the Bank may also
solicit proxies by:
. mail;
. telephone; and
. other forms of communication.
We will also reimburse banks, brokers, nominees and other fiduciaries for
the expenses they incur in forwarding the proxy materials to you.
Obtaining an Annual Report on Form 10-KSB
If you would like a copy of our Annual Report on Form 10-KSB for the year
ended December 31, 1998, which will be filed with the Securities and Exchange
Commission ("SEC"), we will send you one (without exhibits) free of charge.
Please write to:
Linda L. Oldham
Secretary
New Hampshire Thrift Bancshares, Inc.
9 Main Street
Newport, NH 03773
-3-
<PAGE>
PROPOSAL 1--ELECTION OF DIRECTORS
GENERAL
The Company's Board of Directors currently consists of twelve members. The
Board nominated Leonard R. Cashman, Stephen W. Ensign, Dennis A. Morrow and
Kenneth D. Weed for election as directors at the Annual Meeting. All four of
the nominees are currently serving on the Company's Board of Directors. If you
elect the nominees, they will hold office until the Annual Meeting in 2002, or
until their successors have been elected.
We know of no reason why any nominee may be unable to serve as a director.
If any nominee is unable to serve, your proxy may vote for another nominee
proposed by the Board. If for any reason these nominees prove unable or
unwilling to stand for election, the Board will nominate alternates or reduce
the size of the Board of Directors to eliminate the vacancy. The Board has no
reason to believe that its nominees would prove unable to serve if elected.
INFORMATION ABOUT NOMINEES AND CONTINUING DIRECTORS
Set forth below is certain biographical information with respect to the
nominees, the continuing Directors and Executive Officers. Each of these
persons has been engaged in the principal occupation or employment specified for
the past five years unless otherwise noted.
Nominees for Election as Director--Terms to Expire in 2002
Leonard R. Cashman, age 56, a resident of Etna, New Hampshire, is an owner
and a partner of C.O.H. Properties, and owner, President and a Director of
C.O.H. Enterprises, Inc., and a partner in Etna Real Estate Associates. He is
also involved in the marketing of specialized group medical insurance products.
He was formerly Vice President and General Manager of P&C Foods, Inc. Mr.
Cashman has been a director since 1997.
Stephen W. Ensign, age 51, has been associated with LSB since 1971 and
served as Senior Vice President, Senior Loan Officer and Executive Vice
President prior to his election as President, Chief Operating Officer and
Director, effective May 1987. On January 1, 1992 he was elected Chief Executive
Officer of LSB. Mr. Ensign is a Director of NHTB, having served in such
capacity since 1989. Formerly its Executive Vice President, he was elected
President and Chief Executive Officer of the Company effective January 1, 1992.
In 1997, Mr. Ensign was elected Vice Chairman of the Board of Directors of both
NHTB and LSB.
Dennis A. Morrow, age 62, is Sales Manager of Cote and Reney Lumber Company
in Grantham, New Hampshire, and has been associated with this firm for 20 years.
He has served as a Director of LSB since 1984 and NHTB since 1989.
Kenneth D. Weed, age 72, is a partner of L.E. Weed & Sons, a cement
manufacturer located in Newport, New Hampshire. He has served as a Director of
LSB since 1973, and NHTB since 1989.
THE BOARD OF DIRECTORS RECOMMENDS A VOTE "FOR" THE ELECTION OF THE NOMINEES
FOR DIRECTORS.
-4-
<PAGE>
Continuing Directors
Class II Directors--Terms to Expire in 2000
Ralph B. Fifield, Jr., age 74, retired in 1995 from his position as
Executive Vice President of LSB. From April 1987 to August 1990, Mr. Fifield was
employed as a regional president of BankEast Corporation, Hanover, New
Hampshire. Prior to that, he was a Senior Vice President at the First National
Bank of Boston where he retired after 37 years of service. He has served as a
Director of LSB and NHTB since 1990.
John A. Kelley, JR., age 69, is a retired building contractor from Warner,
New Hampshire, and is the owner of a commercial laundromat located in Warner,
New Hampshire. He has served as a Director of LSB since 1975, and NHTB since
1989.
Jack H. Nelson, age 54, a resident of Hanover, New Hampshire, is the
Chairman of the Board of Directors of North East Environmental Products Inc., a
manufacturer and distributor of water treatment equipment. Additionally, Mr.
Nelson is President of the Hanover Water Company. Mr. Nelson has been a
director since 1997.
Priscilla W. Ohler, age 74, has resided in New London, New Hampshire for
over 40 years. She is a volunteer in various state and community activities.
Mrs. Ohler has served as a Director of LSB since 1981, and NHTB since 1989.
Class III Directors--Terms to Expire in 2001
John J. Kiernan, age 72, has been associated with LSB since 1960. He has
served as a Director of the Bank since 1968 and was elected Chairman of the
Board in 1984. He has served as a Director and Chairman of the Board of NHTB
since 1989. Prior to his retirement on December 31, 1991, he served as Chief
Executive Officer of LSB and President and Chief Executive Officer of NHTB. Mr.
Kiernan is the father-in-law of Stephen R. Theroux.
Stephen R. Theroux, age 49, was elected Executive Vice President of LSB
effective May, 1987. He has served as a Director of LSB since 1986. Mr. Theroux
is Executive Vice President and Director of NHTB having served in such
capacities since 1989. Mr. Theroux has served as Chief Operating Officer of LSB
since 1997. Mr. Theroux is the son-in-law of John J. Kiernan.
Peter R. Lovely, age 55, has been associated with LSB since 1980. In 1983,
he formed the Brokerage Services Department and served as Investment Manager of
the Newport, New London, and Upper Valley offices until his retirement in 1998.
He has served as a director of LSB since 1996.
Joseph B. Willey, age 56, is a resident of Norwich, Vermont. Mr. Willey is
a principal owner, the President and a Director of Pro-Cut International, Inc.,
a company engaged in the manufacture, sale and export of automotive repair
products. He was previously a principal owner and a Vice President of Northern
States Tire Corporation. He has served as a director of LSB since 1997.
-5-
<PAGE>
INFORMATION ABOUT BOARD OF DIRECTORS AND MANAGEMENT
Board of Directors
The Board of Directors oversees our business and monitors the performance
of our management. In accordance with our corporate governance procedures, the
Board of Directors does not involve itself in the day-to-day operations of the
Company. The Company's executive officers and management oversee the day-to-day
operations of the Company. Our directors fulfill their duties and
responsibilities by attending regular meetings of the Board which are held on a
monthly basis. Our directors also discuss business and other matters with the
Chairman and the President, other key executives, and our principal external
advisers (legal counsel, auditors, financial advisors and other consultants).
The Board of Directors held fourteen meetings during the fiscal year ended
December 31, 1998. Each incumbent director attended at least 75% of the meetings
of the Board of Directors plus committee meetings on which that particular
director served during this period, unless such absences were otherwise excused
by the Board of Directors.
Committees of the Board
The Board of Directors of the Company has established the following
committees:
EXECUTIVE The Executive Committee considers strategic, planning and
COMMITTEE industry issues and is authorized to act as appropriate
between meetings of the Board of Directors.
Directors Ensign, Kelley, Kiernan, Theroux and Weed serve as
members of the committee.
The Executive Committee met four times in the 1998 fiscal
year.
AUDIT The Audit Committee is responsible for review of the
COMMITTEE reports by the internal auditor and independent public
accountants of LSB and NHTB, and to make recommendations to
management, based on its review of these reports, for
improved or changed operating procedures that it considers
desirable or necessary.
Directors Fifield, Kiernan, Morrow, Nelson and Ohler serve as
members of the committee.
The Audit Committee met one time in the 1998 fiscal year.
CORPORATE The Corporate Organization Committee reviews the corporate
ORGANIZATION structure of the Company and the committee of the Board and
COMMITTEE makes recommendations to management for improvements to
corporate structure.
Directors Kiernan, Ensign, Fifield, Kelley, Theroux and Weed
serve as members of the committee.
The Corporate Organization Committee met three times in the
1998 fiscal year.
-6-
<PAGE>
The full Board of Directors acts as a Nominating Committee for the Company.
Nominations, other than those made by or at the direction of the Board of
Directors of the Company, must be made pursuant to timely notice in writing to
the Secretary of the Company. To be timely, a shareholder's notice shall be
delivered to or mailed and received at the principal executive offices of the
Company, not less than 30 nor more than 90 days prior to the meeting; provided,
however, that in the event that less than 40 days notice or prior public
disclosure of the date of the meeting is given or made to shareholders, notice
by the shareholder to be timely, must be so received not later than the close of
business on the 10th day following the day on which such notice of the date of
the meeting is mailed or such public disclosure was made.
Directors' Compensation
All of the Directors of the Company also serve and are compensated as
Directors of LSB. The Chairman of the Board of Directors receives an annual
retainer of $17,000. Each other non-employee director of LSB receives an annual
retainer of $12,000 plus an additional $100 for each committee meeting attended.
Non-employee directors are also eligible for awards under the NHTB Stock Option
Plans.
Executive Officers
The following individuals are executive officers of the Company and hold
the offices set forth below opposite their names.
Name Position Held with the Company and the Bank
---- -------------------------------------------
John J. Kiernan Chairman of the Board of Directors
Stephen W. Ensign Vice Chairman, President and Chief Executive Officer
Stephen R. Theroux Executive Vice President and Chief Operating Officer
Daryl J. Cady Senior Vice President and Chief Financial Officer
The Board of Directors elects the executive officers of the Company and the
Bank, annually. The elected officers hold office until their respective
successors have been elected and qualified, or until death, resignation or
removal by the Board of Directors. The Company has entered into Employment
Agreements with certain of its executive officers which set forth the terms of
their employment. See "--Employment Agreements."
Biographical information of executive officers of the Company and the Bank
is set forth below.
John J. Kiernan, age 72, has been associated with LSB since 1960. He has
served as a Director of the Bank since 1968 and was elected Chairman of the
Board in 1984. He has served as a Director and Chairman of the Board of NHTB
since 1989. Prior to his retirement on December 31, 1991, he served as Chief
Executive Officer of LSB and President and Chief Executive Officer of NHTB. Mr.
Kiernan is the father-in-law of Stephen R. Theroux.
Stephen W. Ensign, age 51, has been associated with LSB since 1971 and
served as Senior Vice President, Senior Loan Officer and Executive Vice
President prior to his election as President, Chief Operating Officer and
Director, effective May 1987. On January 1, 1992 he was elected Chief Executive
Officer of LSB. Mr. Ensign is a Director of NHTB, having served in such
capacity since 1989. Formerly its Executive Vice President, he was elected
President and Chief Executive Officer of the Company effective January 1, 1992.
In 1997, Mr. Ensign was elected Vice Chairman of the Board of Directors of both
NHTB and LSB.
-7-
<PAGE>
Stephen R. Theroux, age 49, was elected Executive Vice President effective
May, 1987 and previously served as Chief Financial Officer . He has served as a
Director of LSB since 1986. Mr. Theroux is Executive Vice President and
Director of NHTB having served in such capacities since 1989. Mr. Theroux has
served as Chief Operating Officer of LSB since 1997. Mr. Theroux is the son-in-
law of John J. Kiernan.
Daryl J. Cady, age 37, has been associated with LBS since 1985 and has
served in various positions since that time. Ms. Cady was elected Senior Vice
President and the Chief Financial Officer of the Bank and the Company effective
April, 1998. Ms. Cady is a certified public accountant, a member of the AICPA,
and a member of the Financial Managers Society. Ms. Cady received her Bachelors
of Science from Franklin Pierce College and her MBA from the University System
of New Hampshire.
EXECUTIVE COMPENSATION AND OTHER INFORMATION
Since the formation of the Company in April 1989, none of its Executive
Officers and Directors have received any compensation from the Company. The
Directors and Executive Officers have received all of their remuneration from
LSB.
The following table provides certain summary information concerning
compensation paid or accrued by LSB to or on behalf of the Company's Chief
Executive Officer and the Chief Operating Officer (the "Named Executive
Officers") for the last three fiscal years ended December 31, 1998. During that
time, no other Executive Officer received compensation in excess of $100,000.
<TABLE>
<CAPTION>
Annual Compensation Long Term Compensation
-------------------------------------- ---------------------------
Securities
Underlying All Other
Salary Bonus Options Compensation
Name and Principal Position Year ($) ($) (#) ($)(1)
- -------------------------------- ---- --------- -------- ---------- ------------
<S> <C> <C> <C> <C> <C>
Stephen W. Ensign, CEO.......... 1998 $156,000 $15,600 3,500 $15,600
1997 $150,000 $15,000 -- $15,000
1996 $135,000 $10,618 6,500 $13,500
Stephen R. Theroux, Executive
Vice President and COO......... 1998 $114,400 $11,440 3,500 $11,440
1997 $110,000 $11,000 - $11,000
1996 $ 95,000 $ 7,472 4,600 $ 9,500
</TABLE>
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(1) Includes contributions made by LSB on behalf of the Named Executive
Officers to LSB's Profit Sharing-Stock Ownership Plan, a plan qualified
under Sections 401(a) and (k) of the Internal Revenue Code, and amounts
credited on behalf of the Named Executive Officers to LSB's Supplemental
Executive Retirement Plan, a nonqualified, unfunded deferred compensation
plan.
-8-
<PAGE>
EMPLOYMENT CONTRACTS AND TERMINATION OF EMPLOYMENT AGREEMENTS
The Company has entered into an employment agreement with Stephen W. Ensign
as Chief Executive Officer. The employment agreement is for a period of five
years and extends automatically for one additional year on each anniversary date
unless either LSB or Mr. Ensign gives contrary written notice in advance. For
1999, the Board has set Mr. Ensign's salary at $165,000. The employment
agreement provides for participation in discretionary bonuses, retirement and
employment benefit plans and other fringe benefits available to LSB's executive
employees.
The Board of Directors may terminate the employment agreement of Mr. Ensign
at any time with or without cause. However, termination without cause would
subject LSB to liability for an amount equal to the salary for the remaining
term of the agreement without an offset for compensation received from any new
employment. Under the terms of the agreement, in the event of a change in
control of NHTB or LSB resulting in termination of the agreements, LSB would be
liable for an amount equal to five times Mr. Ensign's average salary in the
previous five years. Change in control for purposes of the agreement occurs
when any person becomes the beneficial owner of 25% or more of the voting shares
of LSB's outstanding securities or, if as a result of or in connection with any
cash tender or exchange offer, merger or other business combination, sale of
assets or contested election, a majority of the Board of Directors is not
constituted by individuals who were directors before such transaction.
The Company has also entered into an employment agreement with Stephen R.
Theroux, Executive Vice President and Chief Operating Officer of the Company and
LSB. In the event of a change in control of NHTB or LSB resulting in
termination of the agreement, LSB would be liable for an amount equal to five
times Mr. Theroux's average salary in the previous five years. Change in
control has the same meaning in Mr. Theroux's employment agreement as it does in
Mr. Ensign's employment agreement. If a change of control occurred, the
severance amount payable to Mr. Theroux exceeds $100,000. Mr. Theroux's annual
base salary for fiscal 1999 has been set at $119,000.
STOCK OPTION PLANS
Long-term incentives are provided to the Named Executive Officers through
awards made under the Stock Option Plans established by NHTB from time to time.
Currently, shares remain available for the issuance of option awards under
NHTB's 1996 and 1998 Stock Option Plans. All salaried employees and directors
are eligible to be granted options under the 1996 and 1998 Plans. The 1996 and
1998 Plans provide for the issuance of "incentive stock options" qualified under
Section 422 of the Internal Revenue Code and "non-qualified stock options." The
1996 and 1998 Plans are administered by the Compensation Committee of the Board
of LSB, which has the authority to select the employees and directors who will
be awarded options and determine the amount and other conditions of such awards
subject to the terms of the Plans.
No option issued under the Option Plans is exercisable after the tenth
anniversary from the date it was granted. During the optionee's lifetime, only
the optionee can exercise the option. The optionee cannot transfer or assign
any option other than by will or in accordance with the laws of descent and
distribution. Pursuant to Section 422 of the Code as to incentive stock
options, the aggregate fair market value of the stock for which any employee may
be granted options which first become exercisable in any calendar year generally
may not exceed $100,000. In addition, no grant may be made to any employee
owning more than 10% of the shares of NHTB unless the exercise price is at least
110% of the share's fair market value and such option is not exercisable more
than five years following the option grant.
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<PAGE>
NHTB will receive no monetary consideration for the granting of options
under the Option Plans. Upon the exercise of options, NHTB receives payment from
optionees in exchange for shares issued. During the last fiscal year, NHTB did
not adjust or amend the exercise price of stock options previously awarded.
The following table summarizes the grants that were made to the Named
Executive Officers during fiscal year 1998.
Option/SAR Grants in Fiscal Year 1998
<TABLE>
<CAPTION>
Individual Grants
-----------------
Potential Realizable
Percent of Value at Assumed
Number of Total Annual Rate of
Securities Options/SARs Stock Price
Underlying Granted to Appreciation for
Options/SAR Employees in Exercise or Option Term(2)
Granted Fiscal Year Base Price Expiration 5% 10%
(#)(1) (%) ($ per Share) Date ($) ($)
------ --- ----------- ---- --- ---
<S> <C> <C> <C> <C> <C> <C>
Name
- ----
Stephen W. Ensign
President and Chief Executive Officer...... 3,500 10.0% $21.00 1/2/08 46,224 117,140
Stephen R. Theroux
Executive Vice President and Chief
Operating Officer........................ .. 3,500 10.0% $21.00 1/2/08 46,224 117,140
</TABLE>
- ---------------------
(1) All options granted are incentive stock options which become exercisable
immediately upon grant.
(2) The potential realizable dollar amounts are based on assumed rates of
appreciation prescribed for illustration purposes under the rules of the
Securities and Exchange Commission. The Company expresses no opinion
regarding whether these levels of appreciation will be realized and
expressly disclaims any representation to that effect.
The following table provides information with respect to the Named
Executive Officers, concerning the exercise of options during the last fiscal
year and unexercised options held as of the end of the last fiscal year.
Aggregate Option Exercises in Last Fiscal Year, and Fiscal Year-End Option
Values
<TABLE>
<CAPTION>
Value of
Number of Unexercised
Unexercised In-the-Money
Options at Options at
Shares FY-End (#) FY-End($)
Acquired Value Exercisable/ Exercisable/
Name on Exercise (#) Realized($) Unexercisable Unexercisable/(3)/
---- --------------- ----------- -------------- -------------------
<S> <C> <C> <C> <C>
Stephen W. Ensign/(1)/ -- -- 18,855 92,495
Stephen R. Theroux/(2)/ 2,300 23,862 3,500 --
</TABLE>
- -----------------------
(1) All of Mr. Ensign's unexercised options are exercisable. The number of
unexercised options consists of 3,500 under the 1996 Plan, 6,500 under the
1987 Plan and 8,855 under the 1986 Plan.
(2) All of Mr. Theroux's unexercised options are exercisable. The number of
unexercised options consists of 3,500 under the 1996 Plan.
(3) Based upon a market price of $15.50 per share at December 31, 1998, minus
the exercise price.
-10-
<PAGE>
RETIREMENT PLAN
LSB provides eligible employees with a qualified defined benefit plan (the
"Retirement Plan") designed to meet the requirements of Section 401(a) of the
Internal Revenue Code and the Employee Retirement Income Security Act ("ERISA").
Eligible employees must be at least 21 years of age and must have been employed
by LSB for at least one year. Eligible employees are 100% vested after six
years participation. Directors of LSB are not eligible to participate in the
Retirement Plan. During 1998, all eligible employees of LSB and its
subsidiaries participated in the Retirement Plan. After attainment of normal
retirement age (i.e., age 65), a vested participant is entitled to received
normal retirement benefits based upon years of service and level of
compensation. Benefits to participants with less than 22 years of service will
be reduced by 1/22 for each year of service less than 22. At December 31,
1998, Mr. Ensign had 27.4 years of service and Mr. Theroux had 11 years of
service under the Retirement Plan. The Retirement Plan is funded entirely by
contributions from LSB. The amount of annual contributions are determined based
on an actuarial analysis of an annual census of LSB's eligible employees and
their salaries at December 31 of each year.
The following table illustrates annual pension benefits for retirement at
age 65 under the most advantageous Plan provisions available for various levels
of compensation and years of service. Benefits are computed based on an average
of an employee's highest three years salary out of the last ten years of
employment. There is no Social Security or other offset amount. The figures in
this table are based upon the assumption that the Plan continues in its present
form and certain other assumptions regarding employee participation.
Estimated Annual Benefits Payable for Life
<TABLE>
<CAPTION>
Years of Service at Retirement (Age 65)
----------------------------------------------------
Average Annual Pay(1) 10 Years 15 Years 20 Years 25 Years 30 Years
- ------------------------ -------- -------- -------- -------- --------
<S> <C> <C> <C> <C> <C>
$50,000.................. $ 7,756 11,633 15,511 17,062 17,062
70,000.................. 11,656 17,483 23,311 25,642 25,642
90,000.................. 15,556 23,333 31,111 34,222 34,222
110,000.................. 19,456 29,183 38,911 42,802 42,802
130,000.................. 23,356 35,033 46,711 51,382 51,382
150,000.................. 27,258 40,883 54,511 59,962 59,962
160,000.................. 29,206 43,808 58,411 64,252 64,252
</TABLE>
_____________________
(1) The definition of pay taken into account for determining benefit payments
under the Plan includes substantially the same items of compensation
reflected in the Annual Compensation column of the Summary Compensation
Table set forth above, but limited to the annual amount that may be taken
into account under Section 401(a)(17) of the Code ($160,000 for 1998).
SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT
Security Ownership of Certain Beneficial Owners
As of February 12, 1999, no person or group of persons was known to the
Company to "beneficially own" 5% or more of the Company's Common Stock as of
December 31, 1998. In this proxy statement, beneficial ownership includes those
shares that a person has the power to vote, sell, or otherwise dispose.
Beneficial ownership also includes that number of shares which an individual has
the right to acquire within 60 days (such as stock options) of February 12,
1999. Two or more persons may be considered the beneficial owner of the same
share. We obtained the information provided in the following table from filings
with the
-11-
<PAGE>
SEC and with the Company. In this proxy statement, "voting power" is the power
to vote or direct the voting of shares, and "investment power" includes the
power to dispose or direct the disposition of shares.
The following table shows the number of shares of the Company's Common
Stock beneficially owned by each director and executive officer, and all
directors and executive officers of the Company as a group, as of February 12,
1999. Except as otherwise indicated, each person and each group shown in the
table has sole voting and investment power with respect to the shares of Common
Stock listed next to their name.
<TABLE>
<CAPTION> Number of Shares and
Directors, Nominees, and Executive Officers Nature of Beneficial Ownership Percentage of Total Shares
- ------------------------------------------- ------------------------------ --------------------------
<S> <C> <C>
Leonard R. Cashman.......................... 9,926(1) .47%
Stephen W. Ensign........................... 52,567(2) 2.50
Ralph B. Fifield, Jr........................ 15,800(3) .75
John A. Kelley, Jr.......................... 13,052(4) .62
John J. Kiernan............................. 25,970(5) 1.23
Peter R. Lovely............................. 33,639(6) 1.60
Dennis A. Morrow............................ 21,850(7) 1.04
Jack H. Nelson.............................. 16,158(8) .77
Priscilla W. Ohler.......................... 15,899(9) .76
Stephen R. Theroux.......................... 20,149(10) .96
Kenneth D. Weed............................. 23,456(11) 1.11
Joseph B. Willey............................ 60,216(12) 2.86
Total owned by Directors, Nominees and
Executive Officers as a group
(13 persons)............................. 309,503 14.71%
</TABLE>
(1) Includes 3,717 shares held jointly by Mr. Cashman and his wife with shared
voting and investment power and 2,500 shares subject to outstanding
options.
(2) Includes 27,123 shares held jointly by Mr. Ensign and his wife with shared
voting and investment power, 200 shares held by Mr. Ensign as custodian for
his minor child under the Uniform Gift to Minors Act for which he has sole
voting and investment power, and 18,855 shares subject to outstanding
options.
(3) Includes 8,500 shares subject to outstanding options.
(4) Includes 10,552 shares held jointly by Mr. Kelley and his wife with shared
voting and investment power, with 2,500 shares subject to outstanding
options.
(5) Includes 13,502 shares held jointly by Mr. Kiernan and his wife with shared
voting and investment power, with 130 shares held by his wife in addition
to 1,898 shares held in a spousal IRA for which his wife has sole voting
and investment power and to which Mr. Kiernan disclaims beneficial
ownership, and 8,500 outstanding options.
(6) Includes 18,107 shares held jointly by Mr. Lovely and his wife with shared
voting and investment power, with 300 shares held individually by his wife
in addition to 1,161 shares held in a spousal IRA for which his wife has
sole voting and investment power to which Mr. Lovely disclaims beneficial
ownership.
(7) Includes 6,500 shares subject to outstanding options.
(8) Includes 2,500 shares subject to outstanding options.
(9) Includes 6,500 shares subject to outstanding options.
(10) Includes 11,808 shares held jointly by Mr. Theroux and his wife with shared
voting and investment power, and 3,500 shares which are subject to
outstanding options.
(11) Includes 7,478 shares held in trust by Mr. Weed's wife, and 8,500 shares
subject to outstanding options.
(12) Includes 15,323 shares held jointly by Mr. Willey and his wife with shared
voting and investment power, 24,582 shares held by Mr. Willey as custodian
for his minor children under the Uniform Gift to Minors Act for which he
has sole voting power, 17,122 shares held in an IRA for which he has sole
voting and investment power, and 2,500 shares subject to outstanding
options.
-12-
<PAGE>
CERTAIN TRANSACTIONS WITH MANAGEMENT AND OTHERS
LSB maintains a policy that loans to Directors, Executive Officers and
principal shareholders must be made on substantially the same terms as those
prevailing for loans to unrelated parties, and must not involve more than the
normal risk of repayment or present other unfavorable features. In addition,
Board of Directors approval (with the interested person abstaining) of aggregate
loans to such persons in excess of the higher of $25,000 or 5% of unimpaired
capital and surplus, and in any event if more than $500,000 is required. A
limit has also been imposed on aggregate loans to a Director, Executive Officer
and principal shareholder of the higher of 2.5% of a bank's capital and
unimpaired surplus or $25,000, but in no event more than $100,000 (excluding
certain home and education loans).
COMPLIANCE WITH SECTION 16 OF THE EXCHANGE ACT
Section 16(a) of the Exchange Act requires that the Company's directors,
executive officers, and any person holding more than ten percent of the
Company's Common Stock file with the SEC reports of ownership changes, and that
such individuals furnish the Company with copies of the reports.
Based solely on its review of the copies of such forms received by it, or
written representations from certain reporting persons, the Company believes
that all of our executive officers and directors complied with all Section 16(a)
filing requirements applicable to them.
PROPOSAL 2--RATIFICATION OF APPOINTMENT OF AUDITORS
The Board of Directors has appointed Shatswell MacLeod & Co., P.C. as our
independent public auditors for the Company for the fiscal year ending December
31, 1999, and we are asking stockholders to ratify the appointment.
One or more representatives of Shatswell, MacLeod & Company, P.C. are
expected to be present at the Annual Meeting of Shareholders and will have the
opportunity to make a statement if they desire to do so, and such
representatives are expected to be available to respond to appropriate
questions.
THE BOARD OF DIRECTORS RECOMMENDS THAT THE SHAREHOLDERS VOTE FOR
RATIFICATION OF THE APPOINTMENT OF SHATSWELL, MACLEOD & COMPANY, P.C. AS
INDEPENDENT AUDITORS.
A majority of the votes cast is required for ratification. If the
shareholders fail to ratify the appointment, such action will be considered as a
direction to the Board of Directors to select another independent auditing firm.
OTHER BUSINESS
We know of no other business which will be presented for consideration at
the Annual Meeting other than as stated in the Notice of Meeting. If, however,
other matters are properly brought before the meeting, it is the intention of
the persons named as proxies in the enclosed proxy card to vote the shares
represented thereby in accordance with their best judgment and in their
discretion, and authority to do so is included in the proxy.
-13-
<PAGE>
ADDITIONAL INFORMATION
Information About Stockholder Proposals
If you wish to submit proposals to be included in our 1999 proxy statement
for the 2000 Annual Meeting of Stockholders, we must receive them by November 5,
1999, pursuant to the proxy soliciting regulations of the SEC. SEC rules
contain standards as to what stockholder proposals are required to be in the
proxy statement. Any such proposal will be subject to 17 C.F.R. (S)240.14a-8 of
the rules and regulations promulgated by the SEC.
In addition, under the Company's Bylaws, if you wish to nominate a director
or bring other business before an annual meeting:
. You must be a stockholder of record and have given timely notice in
writing to the Secretary of the Company.
. Your notice must contain specific information required in our Bylaws.
By Order of the Board of Directors,
/s/ Linda L. Oldham
Linda L. Oldham
Secretary
Newport, New Hampshire
March 5, 1999
TO ASSURE THAT YOUR SHARES ARE REPRESENTED AT THE ANNUAL MEETING, PLEASE
COMPLETE, SIGN, DATE AND PROMPTLY RETURN THE ACCOMPANYING PROXY CARD IN THE
POSTAGE-PAID ENVELOPE PROVIDED.
-14-
<PAGE>
New Hampshire Thrift Bancshares, Inc. REVOCABLE PROXY
This Proxy is solicited on behalf of the Board of Directors of New Hampshire
Thrift Bancshares, Inc. for the Annual Meeting of Stockholders to be held on
April 8, 1999.
The undersigned stockholder of New Hampshire Thrift Bancshares, Inc. hereby
appoints John J. Kiernan and Ralph B. Fifield, Jr., and each of them, with full
powers of substitution, to represent and to vote as proxy, as designated, all
shares of common stock of New Hampshire Thrift Bancshares, Inc. held of record
by the undersigned on February 12, 1999, at the 1999 Annual Meeting of
Stockholders (the "Annual Meeting") to be held at 10:00 a.m., Eastern Standard
Time, on April 8, 1999, or at any adjournment or postponement thereof, upon the
matters described in the accompanying Notice of the 1999 Annual Meeting of
Stockholders and Proxy Statement, dated March 5, 1999, and upon such other
matters as may properly come before the Annual Meeting. The undersigned hereby
revokes all prior proxies.
This Proxy, when properly executed, will be voted in the manner directed
herein by the undersigned stockholder. If no direction is given, this Proxy
will be voted FOR the election of all nominees listed in Item 1 and FOR the
proposal listed in Item 2.
PLEASE MARK, SIGN AND DATE THIS PROXY ON THE REVERSE SIDE
AND RETURN IT PROMPTLY IN THE ENCLOSED ENVELOPE.
<PAGE>
<TABLE>
<CAPTION>
------------------------------------------------------------------------------
The Board of Directors unanimously recommends a vote "FOR" all of the nominees Please mark your vote [x]
named in Item 1 and a vote "FOR" the proposal in Item 2. as indicated in this
------------------------------------------------------------------------------ example.
I will attend the [ ]
Annual Meeting.
<S> <C> <C>
1. Election of four FOR WITHHOLD
Directors for terms of All nominees for all
three years each. (except as nominees
Nominees: Leonard R. otherwise
Cashman, Stephen W. Ensign, indicated)
Dennis A. Morrow, and [ ] [ ]
Kenneth D. Weed
Instruction: TO WITHHOLD
AUTHORITY to vote for any
individual nominee, write
that nominee's name in
the space provided:
- -----------------------------
FOR AGAINST ABSTAIN
2. Ratification of the [ ] [ ] [ ]
appointment of
Shatswell MacLeod & Co., P.C. as
independent auditors for the fiscal year
ending December 31, 1999.
The undersigned hereby acknowledges receipt of the Notice of the 1999 Annual
Meeting of Stockholders and the Proxy Statement, dated March 5, 1999 for the
1999 Annual Meeting.
- --------------------------------------------------
- --------------------------------------------------
Signature(s)
Dated:____________________________________________, 199_
Please sign exactly as your name appears on this proxy. Joint owners should each
sign personally. If signing as attorney, executor, administrator, trustee or
guardian, please include your full title. Corporate or partnership proxies
should be signed by an authorized officer.
</TABLE>
